Talent Management: HR Managers Focus on Hiring Top Talent, Controlling Costs and Increasing HR Compliance
This insight is from: "Competition, Cost Control & Compliance: Strategies to Navigate a Changing HR World"
As organizations like yours are well aware, talent management is critical to competitive success. To survive and thrive in today’s dynamic business climate, companies must operate as efficiently as possible while maintaining HR compliance and the ability to attract and retain top talent. In our recent survey of HR managers in small (10-49 employees) and midsized (50-999) businesses, respondents identify maximizing productivity and capitalizing on talent as two essential strategies for maintaining a competitive edge. The survey findings reveal that, while cost containment remains an important focus, HR managers are increasingly seeking advice on HR compliance and paying closer attention to recruitment, productivity and other talent management issues.
Employers Believe Competitive Success Is Tied to Effective Talent Management
When asked about their top business concerns, those issues that impact their ability to meet their goals and potentially prevent them from executing their competitive strategies, HR managers at small and midsized businesses ranked locating and hiring qualified employees second — right behind the rising cost of benefits. When asked about their top strategies for maintaining a competitive edge, respondents in midsized businesses ranked hiring top talent number one (47 percent) and those in small businesses ranked it number three (35 percent). However, respondents also project that top talent may soon become more difficult to attract. Given this focus on hiring, it’s important to note that large numbers of respondents are not fully confident in many of their hiring practices. In fact, recruitment and hiring are compliance areas about which HR managers in both small and midsized companies express concern.
Employee Productivity Takes Center Stage in Talent Management
As companies take steps to best leverage talent management for competitive success, issues like employee engagement and productivity emerge as top priorities. Out of nine possible strategies for maintaining a competitive edge, survey respondents rank focusing on employee productivity second — ahead of such traditional strategies as investing in technology or maintaining an optimal business location. Findings also indicate a high level of agreement among HR managers regarding how best to improve productivity. Training and development was the clear preference among 88 percent of midsized businesses and 82 percent of small businesses. Since current research demonstrates a correlation between employee engagement, productivity and ultimately, profits, it appears that HR managers are focused on the right talent management practices for driving competitive success.
Cost Control Remains Critical to Competitive Business Success
While our survey findings clearly indicate concerns about employee recruitment and retention and an increased focus on employee productivity among HR managers, the importance of overhead costs cannot be ignored. Respondents rank controlling overhead among their top three competitive business strategies. Further highlighting cost containment concerns, when asked to identify the issues having the greatest impact on their business, HR managers at both small and midsized companies list the rising cost of benefits first.
HR Managers Indicate that Talent Management Matters
According to our survey, cost control and HR compliance are critical concerns for HR managers in today’s competitive and rapidly changing business climate. As the war for talent wages on, however, HR managers appear to be increasing their focus on talent management areas like employee recruitment, retention, and productivity. In a highly competitive economy, shortcomings in any of these areas can put a business at a significant disadvantage.
*A complete list of sources and citations can be found in the full report.
About This Report: Report data and conclusions are based on a 2011 ADP Research Institute survey of HR managers in 319 small and midsized businesses nationwide that looked at current business issues and examined levels of confidence related to key areas of HR compliance. See full report for details on research methodology. The ADP Research Institute is a specialized group within ADP that provides insights to leaders in both the private and public sectors around issues in human capital management, employment trends, and workforce strategy.